KARACHI: The Pakistani currency on Tuesday recorded a minimal decline of 0.01% against the US dollar due to the widening current account deficit.
The news about the widening trade deficit was not in line with the market, resulting in a setback in the local currency, which remained stable against the U.S. dollar a day ago.
According to data shared by the National Bank of Pakistan (SBP), the Pakistani rupee depreciated by 0.01%, pushing the dollar to a record high of 178.05 rupee.
Pakistan’s current account deficit—the gap between foreign payments and inflows—increased slightly to US$1.91 billion in November 2021.
Earlier, analysts had predicted that the rupee may expand its decline in the coming days due to losses caused by importers’ payment demands and exporters’ slow inflow.
A foreign exchange dealer said: “We anticipate the rupee to remain on the back foot next week, as a decline in the foreign exchange reserves due to rising imports and foreign debt-related outflows remains a drag on sentiment.”
It seems that until the end of the month, the demand for hard currency from importers will continue, especially from the energy sector, which will impact the rupee.
“Inflows from exporters remain sluggish as they expect the rupee to depreciate more in the days ahead,” he added.